The Group Securities: Weekly Report on QSE Performance, 7 – 11 October 2018

General Index Drops below 9900 Points

October 14, 2018

The price of OPEC oil fell to US $82.6 per barrel, coinciding with the release of QNB’s financial statements for the third quarter 2018 that showed that despite the increase in the bank’s net profit in the first 9 months of 2018, its comprehensive income has incurred losses of QR4.47 billion, mostly due to exchange rate differences, which reduced the bank's comprehensive income to QR6.42 billion. As a result, the share prices of 27 companies declined, while the share prices of 15 companies rose. The final outcome of the stock market in a week was that the total volume of trading decreased by 16% to QR744 million, and the general index dropped by 0.41% to the level of 9861.5 points.

In depth, the general index decreased by about 41 points, or 0.41% to the level of 9862 points, while Al Rayan Islamic Index fell by 0.14%. Four sector indices have decreased, especially Transport, Banking and Insurance. It has been noticed that the share price of Ahli Bank was the biggest loser, down by 7.8%; followed by Commercial Bank by 4.9%, Investment Holding by 3.16%, and Doha Bank by 2.9%, then Qatari Investors by 2.6%. In contrast, the share price of Dlala was the top gainer, up by 5.5%, followed by Barwa by 3%, QIMC by 2.1%, and Al Meera by 1.64%, then Zad by 1.5%.

The total trading volume decreased by 27.8% to the level of QR744.3 million in a week, so the average daily trading volume dropped to QR148.9 million. QNB led the traded shares with a volume of QR118.5 million, followed by the share of Woqod with QR98.8 million, Industries Qatar with QR86.4 million, and Barwa with QR62 million. It was noticed that Non-Qatari portfolios have dominated the net purchases compared to all other segments with a total of QR68 million, while Qatari portfolios made net sales of QR32.8 million. Qatari individuals made total net sales of QR28.1 million, whereas foreign individual investors made net sales of QR7.1 million. As a result, QSE’s total capitalization decreased by QR2 billion to reach QR551.7 billion, and the P/E ratio stood at a multiple of 13.93.

Corporate News:

1-      QNB Group’s net profit amounted to QR10.82 billion, compared to QR10.25 billion recorded in the same period last year, while the bank’s earnings per share reached QR11.4, versus QR10.7 for the same period in 2017. The operating income of Qatar National Bank Group increased by 5.5% to QR17.9 billion for the first nine months of the current year, of which QR14.1 billion from interest. Expenditures rose by 8.7% to QR6.54 billion, of which QR1.66 billion went to losses of loans and loans to customers, noting that the latter’s losses rose by 7.3% compared to the corresponding period of the previous year. As a result, the net profit attributable to shareholders increased by 5.6% to QR10.82 billion. The bank incurred a significant increase in its comprehensive income loss that reached QR4.47 billion due to exchange rate losses. All resulted in the decline of the comprehensive income by 34.4% to QR6.42 billion.

2-     Vodafone Qatar announced that it has obtained the approvals of Qatar Financial Markets Authority and the Ministry of Economy & Trade with regards to the reduction of the company's capital from QR 8,454 million to QR 4,227 million through reducing the nominal value of the company's shares from QR10 per share to QR5 per share. Vodafone Qatar is currently completing the necessary procedures to ratify the proposed amendments to the company's Articles of Association, which were previously approved by Vodafone Qatar's shareholders on March 19, 2018 to reflect the capital reduction and related amendments in its Commercial Register.

3-      Qatar Fuel Co. (Woqod) announced that it has increased the number of its petrol stations to 65 varying between permanent and mobile, following the inauguration of a new station in Old Salata today, as part of its strategic plan to expand its network of stations and serve all regions of the country.

Financial & Economic Developments:

1-      Qatar's GDP grew in the second quarter of this year by 2.5% compared to the same period last year. According to the data of the Ministry of Development Planning & Statistics, the GDP at constant prices amounted to about QR204.4 billion in the second quarter compared to QR199.3 billion in the same period of 2017. The GDP at current prices grew by 17.9% year-on-year to QR171.5 billion.

2-      OPEC oil price decreased by about US $0.95 per barrel to the level of US $82.6 per barrel until Wednesday.

3-      Dow Jones dropped by 739 points to the level of 25513 points until closing on Thursday. US dollar declined to $1.16 against the Euro, and against the yen to ¥112.43 per dollar. Gold climbed by about US $18 to US $1219.5 per ounce.